Buy AT&T Inc. (T) Stock for Its Growth, Not Just Its Dividend

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AT&T Inc. (NYSE:T) is doing all it can to make sure that it is dominant in the 21st Century as it was throughout the 20th.

Buy AT&T Inc. (T) Stock for Its Growth, Not Just Its Dividend

Its recent megadeal to buy satellite television provider DirecTV for $49 billion was just the beginning of its strategy to build a strong vertical presence across content channels. It has since bundled DirecTV services with T stock’s mobile platform and offers data-free viewing for AT&T subscribers.

While other content providers are not happy with this deal and have taken their case to the Federal Communications Commission (FCC), the new change in leadership in D.C. may well see an FCC that less concerned with net neutrality and more concerned with business interests.

TWX and T Stock

The other big front that T is working on is the purchase of Time Warner Inc (NYSE:TWX) for a whopping $85 billion. The Barack Obama administration, and even President-elect Donald Trump have raised concerns about the deal. But the CEO and a senior AT&T VP were seen Thursday morning at Trump Tower in New York for a 9:30 a.m. meeting with the future president.

There’s little doubt what that discussion was about. Now we will see if T stock made any headway.

But getting into AT&T is a good idea, because approval of the TWX deal isn’t factored into the stock right now, and it’s likely if the deal doesn’t go through in its entirety, there will be the possibility of revising the deal to make both T and the government happy.

T was up 20% in the past 12 months but has just gotten back near its 52-week highs in recent weeks. After a solid run into the summer, the stock cooled in Q4. This is an encouraging sign. The profit takers are already out and the stock is moving on its merits moving forward.

Beyond the two megadeals (one pending), T stock is also not resting on its laurels in the mobile space. It’s using its DirecTV bundle to attract cord cutters, who can stream over 100 channels of premium content for $60 a month. T is also launching a 5G test of its streaming services in Austin, Texas in the coming year.

5G is 10-100 times faster than 4G streaming. This is a bold move into cutting-edge technology and this is the value of having a content partner like DirecTV. T can now offer content at much higher speeds than its competitors, which will be a big value for cord cutters and mobile gamers. T is so much more than a telecom at this point, and if the TWX deal goes through, the increased ad sales alone will be enormous.

On the other side of all this growth is the fact that T is one of the  Dividend Aristocrats. That means it has raised its dividend every year for more than 25 years. In its case 32 years and counting. What’s more, T throws off a very attractive 4.8% dividend.

The bottom line is, there are plenty of reasons to be bullish on T stock, even during this time of transition.

Louis Navellier is a renowned growth investor. He is the editor of five investing newsletters: Blue Chip Growth, Emerging Growth, Ultimate Growth, Family Trust and Platinum Growth. His most popular service, Blue Chip Growth, has a track record of beating the market 3:1 over the last 14 years. He uses a combination of quantitative and fundamental analysis to identify market-beating stocks. Mr. Navellier has made his proven formula accessible to investors via his free, online stock rating tool, PortfolioGrader.com. Louis Navellier may hold some of the aforementioned securities in one or more of his newsletters.

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Article printed from InvestorPlace Media, https://investorplace.com/2017/01/att-inc-t-stock-dividend-aristocrats/.

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